Even elite law firms get stiffed.
The party not paying its legal bill was Alex Shnaider, a Russian-Canadian billionaire. The legal matter had been Boies Schiller's representation of him in a contract case.
Shnaider's former business partner Eduard Slinin had sued him for a breach of contract involving the buying and selling of private jets. In defending the client from February 2016 until September 2018, Boies Schiller's Karen Dyer was able to persuade U.S. District Judge Richard Sullivan to narrow the case to one count for an accounting on dissolution on the partnership with Shnaider. Tossed were claims for unjust enrichment and breach of fiduciary duty.
When Shnaider did not pay the fee for service Judge Sullivan granted the law firm's request to withdraw from the case.
Then, Schnaider, reports Scott Flaherty in Law.com, went to a New York state court to petition for the return of a file retained by Boies Schiller in connection with that jet case. The file contains information obtained during discovery. That file pertains to another legal matter Shnaider is involved in.
The state court, notes Flaherty, is scheduled to hold a hearing on that petition today. Shnaider is represented by the Michael Bown at Kasowitz Benson Torres. New York Supreme Court Justice Debra James is presiding over that hearing.
Unlike many other businesses, law firms have unique options for pressuring deadbeats to pay the bill. In professional services, being stiffed after pulling out all stops to do a good job for the client is soul-wrenching.
The court sided with Boies Schiller. It can retain the discovery material. Shnaider owes that law firm about $1 million in legal fees. Here are more details from Flaherty at Law.com.
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